None of you know this yet, but I’ve been keeping a rather salacious secret from you when it comes to my financials ;) I don’t know why I did it at first, other than seeing how long I can keep something hidden for, haha… (and here you thought I spilled *everything!*) but after a while I guess I just kinda got used to it and didn’t realize how much time had been passing. Only yesterday, I suddenly wake up and realize that, Holy $hit!, I’m about to be a free man!
And herein lies the secret ;) I, J. Money – king of all things money and blogging – had snuck in a $18,000 (!!!) loan from the Bank of Mom & Dad! And no one knew but the wife! (oooooooohhh… ahhhhhhhh… crowd gets shocked!) Haha… It sounds pretty crazy w/out the details, but I assure you it was a calculated play based on whole bunch of variables (and potential) from the get go.
Let’s start from the beginning, shall we?
- 18 months ago I get approached by a friend to invest in a project.
- It’s an income-producing deal, but I needed a whopping $18,000 to own it outright (and really, that was the best way to play it. As shady as that sounds (no it’s not illegal or anything, haha…)
- I considered borrowing against my own money, but at the time I was in the process of saving up for my goal of blogging full-time, and it didn’t make sense for me to pull out all of the money I had in there (which was around $20k at that point) – even IF it would help me reach my goal a little faster (it did). Looking back it was a good thing too considering I got laid off just a few months later ;)
- So at that point, it was either borrow the money from somewhere else, or pass on the opportunity and continue trucking forward w/ my $50k savings goal. I chose borrowing from mom and dad instead.
- After talking with my parents, and researching other personal loans out there (including a cash advance from my USAA credit card which would have only come out to about 6%! (they’re pretty good about that if you call and lock in a deal before using one of those c/c checks), I decided to take them up on their offer of 0% interest.
- At first it felt pretty weird/wrong – esp since I HAD the money and I just didn’t wanna tap it yet – but like with all parents, they really wanted to help out their kid and were just as excited to loan me the money, as I was for the business venture and to prove myself ;) I tried offering them at least 2-3% for their time and what not, but they wouldn’t have any of it and declared it was gonna be 0% or nothing.
- So I took it :) And then we wrote up an agreement, had everyone sign it, and decided that for the next 18 months straight I’d cut them a check for $1,000 until it was entirely paid off in full.
Which leads us to today! The day I send in my very last check and become $1,000 richer each month! Woohoo! (I actually made the last check $1001 just to force them to take an extra dollar from me in the end! haha…) I figured I’d have to tell y’all some time since my future Net Worths were about to look a heck of a lot better! And I had no explanations on where the heck that extra money would be coming from ;) Kinda hard to hide $1,000 every month when you list out all your financials for everyone to see! Haha…
So that’s the news! What do all think? Would you have done the same in my shoes, or just gone ahead and dipped into your savings and/or passed up on the deal entirely? I can’t divulge what, exactly, the project WAS that I took on a year and a half ago (I promised I’d keep it on the hush) but I can tell you that it has, indeed, been generating well over the $1,000/mo I was paying for it each month… which was the #1 factor in making this decision to begin with: The fact that I could use this generated income to PAY OFF the entire loan this way. Provided it continued on the right path the whole time, of course ;) This woulda been a completely different post had things gone awry! Haha… And it may or may not have been hidden from y’all even longer in that case ;)
Any of you taking calculated risks these days? Or bet yet – have some juicy secrets to tell ME?!
I wanna know!!
(Photo by Zawezome)